No major events are expected today.

The pair is holding near elevated levels following several sessions of growth. Primary support for the pair comes from rising U.S. Treasury yields: the ten-year yield approached highs not seen since 2007, as the market strengthened expectations of another Fed rate hike. This dynamics is particularly sensitive for the yen, as the yield spread once again works in favor of the dollar.

The Bank of Japan raised its interest rate to 1.25% last week, but the decision failed to provide sustained strength for the yen. Investors noted the absence of a clear signal regarding swift future steps, as well as disagreements within the board. This limits the impact of policy tightening, especially against the backdrop of rising U.S. yields and persistent demand for the American currency.

A key restraining factor remains the risk of action by Japanese authorities: rate check reports emerged following the Bank of Japan meeting, and recent interventions leave the market sensitive to yen weakness. Consequently, the upside potential for USD/JPY appears more limited than the dollar’s momentum against the euro and pound. In the absence of new confirmed actions from Tokyo, the baseline scenario still allows for a cautious continuation of the pair’s upward movement.

Recommendations: BUY 158.70, SL 158.35, TP 159.40.